Courted by contractors, a Pounds 160 million business remains steadfastly in house, says Richard Taylor.

The chill of change is gusting through academia. In its wake, the twin spectres of swingeing Government cutbacks and a soaring student intake have left vice chancellors with little alternative but to explore ingenious new ways of financing an overhaul of their already stretched resources.

Faced with a leaking roof or the prospect of digging deeper into an already depleted pocket to drum up capital for a new building programme, hard-pressed universities have often been tempted to pass the chronic headache of hospitality into the eager arms of the contract caterer. But as The Universities Catering Officers (TUCO) can testify, provided they enjoy the support of the university, in-house resources continue to deliver an undisputed track record of contributing more to the "body and soul" of Britain's universities and colleges, than could reasonably be expected from any outsider with one eye on its shareholders.

Far from being a hole in a university's pocket, members of TUCO, a voluntary national body, currently chaired by Geoffrey Minshull, general manager at Salford University, have been ploughing their energies and subsequent profits back into revitalising the business plans of nearly 95 per cent of Britain's colleges and universities. Yet the perception for many academics is of a heavily subsidised "greasy spoon" operation, enjoying a free ride at the expense of an ever resourceful management.

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While the image of a canteen culture prevails, it is a business with a turnover of Pounds 160 million, where food costs, as a percentage of sales, are squeezed to within 40 per cent; a business that succours an army of over one million students and staff across more than 100 campuses nationwide, feeds a flourishing year-round exhibition and conference trade valued at over Pounds 100 million, plays host to the "Town & Gown" alliance that generates the lifeblood funding of research grants, collaborates with institutional purchasing bodies to win more every year from hard-pressed budgets; a business whose profits are consistently invested to empower people as well as to upgrade facilities in order to benefit its customers.

To understand how a service, still misunderstood by many as refectory catering, has burgeoned into an influential hospitality industry with the means to pay its way, it is necessary to turn the clock back ten years, to when management opened its eyes to the world of commerce. A new word entered the vocabulary: marketing. In came consultants with an eye to cost-efficient practices. Next came the quest for a new breed of dedicated business managers with a proven track record in service industries.

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Stephen Bland, residence and catering services manager at Bedford and Royal Holloway College, University of London, represents this cultural revolution. "I have come from the highly competitive commercial world and there's no doubt in my mind that catering and other services within universities must strive to meet the same standards of efficiency as they do in a hospitality industry outside. The fact that we achieve these standards at Royal Holloway and that many of my colleagues elsewhere achieve similar standards only shows how far the university sector has gone in the last few years."

Endorsing this, a recent survey by Tricon Consultants highlighted the fact that the purchasing for Manchester Metropolitan University's in-house catering was at least as good if not better, than the contract market which was used as a yardstick.

One way in which TUCO is demonstrating sound management practice is its vital collaboration with institutional purchasing, to extract maximum operational benefit from "volume" negotiation. This has led to exclusive contracts with a host of big names from Britvic to Whitbread and Coca Cola to Schweppes.

Such profitable partnerships, exemplified by TUCO's purchasing arm SNUPI (Scottish and Northern Universities Purchasing Initiative) representing the livelihood of nearly 50 ÖйúAƬ facilities, has wrought more every year in discounts and aftersales support, from their annual Pounds 10 million spend on food, groceries and confectionery, despite a formidable tide of rising costs. If TUCO admits that criticism of staff and practices in the bad old days was entirely justified, there is no doubt that empowerment ranks high on today's management agenda.

With proper provision for training funded from commercial operating profits, a rigorous policy applies of targeted recruitment, appraisal and education from basic induction to skills enhancement. Many in-house operations now boast their own training units employing full-time qualified managers who provide both short course and vocational training. This includes the new National Vocational Qualifications up to Level 4, addressing managerial and administrative staff. Some universities - Hull, Sheffield and Exeter in particular - have further demonstrated their commitment to human resources by securing industry's coveted accolade, Investors in People status.

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Sheffield TUCO members have gone one step further. By providing training consultancy to other universities as well as the private sector, the resultant revenue has been used to offset the costs of their own training programme.

One high-profile showcase for all this talent is the prestigious annual British Universities Chefs Challenge, sponsored by TUCO, it has the cream of in-house catering engaging in culinary combat where the team champions represent TUCO in the Parade des Chefs at Hotel Olympia.

While a crusade for greater professionalism may not be the most visible manifestation of an independent business contributing to the wealth of ÖйúAƬ, capital projects cannot be ignored. That aside, a changing High Street dictating student taste and aspirations has not gone unnoticed by the new breed of market-driven TUCO members.

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These days you would be hard pressed to unearth any vestige of the musty panelled refectory. Instead, once the stomach dictates, you can expect to be pampered with anything from simple drinks and crisps dispensers in almost every corridor, to 24-hour pizza delivery, burger bars, the romance of the brasserie or silver service banqueting for mass social events.

Having marshalled a formidable argument in favour of a long overdue reassessment of the in-house resource, reservations remain. Five per cent of ÖйúAƬ management has been happy to delegate the problem to outsiders. But outside contractors, however healthy their relationship with their clients, have their shareholders' interests to consider - first and foremost. Profits to them represent higher dividends and a fertile future with minimum interference.

The principal attraction of the outsider lies in the immediate funding they can bring to the table. Confronted by pressures to renew or expand facilities, managers can be forgiven for mistaking this cash cow as the panacea to all their ills. Often contractual strings dictate exactly where the funding will go, usually into building one specific facility to the exclusive benefit of the contractor, while also tying the hands of central purchasing to the contractor's nominated suppliers.

Geoffrey Minshull, TUCO's national chairman, says: "Our achievements over the last ten years have demonstrated where the real long-term advantages lie for the campus fraternity. We have as much a vested interest in a student's diet as we have in contributing to new facilities. Today our skills, energies and marketing intuition rank alongside the best on the open market. Where the relationship works to its best effect is where we are embraced as a true business partner, capable of positively influencing a university's fortunes. All we want, is the opportunity to prove it."

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